MacRumors

In the wake of yesterday's announcement that the U.S. Department of Justice has filed an antitrust lawsuit against Apple and a number of book publishers over alleged price fixing, CNET notes that the government may have a hard time winning its case against Apple. The publishers may, however, find themselves on the losing end of the case should they be unwilling to settle.

"It's a harder case against Apple than the publishers," says Geoffrey Manne, who teaches antitrust law at the Lewis and Clark Law School in Oregon and runs the International Center for Law and Economics.

One reason lies in the Justice Department's 36-page complaint, which recounts how publishers met over breakfast in a London hotel and dinners at Manhattan's posh Picholine restaurant, which boasts a "Best of Award of Excellence" from Wine Spectator magazine. The key point is that Apple wasn't present.

But even the case against the publishers is not a sure thing for the Department of Justice. Some experts suggest that even amid claims that the publishers met to discuss a shift to an agency model being championed by Apple, the publishers may not be found guilty of antitrust violations.

Specifically, the Supreme Court has ruled in the past that pricing arrangements among competitors are not automatically considered to be violations of antitrust law, and that the setting of minimum retail pricing by manufacturers is a permitted policy.

Several of the publishers involved in the lawsuit have already settled, but Macmillan and Penguin are holding out along with Apple to fight the case. Almost immediately following the filing of the Department of Justice's lawsuit, a number of states filed their own claims against the companies, citing customer overcharges of over $100 million since the move to an agency model of pricing. Regulators in other countries are also reportedly looking at whether they wish to take action on the matter.

The Next Web reports that Apple has begun enhancing the security of users' Apple ID accounts, requiring those who have do not have alternate email addresses and security questions on file to add them.

In the past 24 hours, Apple appears to have started prompting iOS devices owners and those with Apple IDs within iTunes to make their accounts more secure, requiring them to pick three security questions and enter their answers when they download a new app.

The company is also asking users to enter a backup email address, in order to better protect their device but also their account (which is tied to Apple’s Retail website and all of its media services).

Hacking of iTunes Store accounts has been a long-standing complaint from a number of users, but with over 225 million user accounts, they make for a popular target for phishing, brute force hacking, and other methods. The company has occasionally taken steps to improve account security such as last August's addition of confirmation emails when content is purchased from a previously-unused device, and the company undoubtedly evaluates its security practices on an ongoing basis.

VR-Zone reports that Intel has begun shipping its second-generation Thunderbolt controller chip, known as "Cactus Ridge". As previously discussed, Cactus Ridge will arrive in both four-channel (DSL3510) and two-channel (DSL3310) versions, offering Apple a pair of options for including the new chips in its forthcoming products.

Another aspect that makes the DSL3510 interesting is that it supports multiple internal DisplayPort inputs. What this means is that it could in theory interface with a discrete graphics card as well as the integrated graphics from an Intel CPU. This is likely to be the chip used by Apple in its desktop systems, whereas the more power efficient DSL3310 will end up in notebook products.

The arrival of the new Thunderbolt chips lines up nicely with Intel's Ivy Bridge processors to set the stage for updates to a number Apple's Mac lines. Previous reports have indicated that the first batch of quad-core desktop and mobile Ivy Bridge chips appropriate for Macs should be arriving on April 29, with an announcement coming in the week prior to that date.

Digitimes now claims that the announcement will take place on April 23, with a number of PC manufacturers lined up and ready to launch systems using the new processors. The report points to PC vendors being ready to release new ultrabooks beginning in May, but previous reports had claimed that the lower-voltage chips likely to make their way into the more compact machines won't be launching until early June.

Rob Schmitz of public radio show Marketplace played a key role in debunking a number of Mike Daisey's claims about his trip to China to see working conditions at Apple's manufacturing partner Foxconn. As part of his investigation, Schmitz tracked down Daisey's translator and learned that a number of the experiences Daisey related as part of his "The Agony and Ecstasy of Steve Jobs" theater monologue never happened.

Following his exposure of Daisey's fabrications, Schmitz has been given access to Foxconn's plants, and he has been filing some reports about what he has seen in those facilities. Among the most interesting contributions is a brief video posted yesterday showing for the first time several of the steps in assembling and testing an iPad.

Marketplace has aired a number of segments interviewing Schmitz about his visits to Foxconn's plants, where has described working conditions and talked with workers about their experiences. Many note that the work is boring and repetitive and that they are sometimes treated like machines, but most seem to acknowledge that Foxconn offers better opportunities than many of the other factories.

Research firm Gartner today released its preliminary personal computer shipment data for the first quarter of 2012, offering up a picture of market performance during the quarter. While Apple experienced only small year-over-year unit growth of over 3.8% and was beaten among top 5 vendors by HP's 6.6% growth, the company did once again outperform the overall industry and its 3.5% decline.

Apple's share of the U.S. market registered at 10.6% and has dipped for two straight quarters, dropping from 12.9% in the third quarter of 2011 and 11.6% in the fourth quarter. The weakness in Apple's Mac sales has primarily been attributed to a lack of hardware updates as the company awaits the launch of Intel's Ivy Bridge chips. Still, Apple's 10.6% share during the quarter topped its 9.8% share from the first quarter of 2011.

As usual, Gartner did not cover Apple's worldwide market share for the quarter, as the company does not rank among the top five vendors on a worldwide basis. PC shipments experienced slow 1.9% year-over-year on a worldwide basis, with strong growth from Lenovo and Asus keeping the industry in positive territory.

Yesterday, Apple disclosed for the first time that it is working to develop a software tool to detect and remove the Flashback malware from infected machines. We also previously profiled Flashback Checker, a simple app designed to allow users to easily see if their Macs are infected but which provides no assistance with disinfection.

While Apple works on its own official solution, other parties have continued to develop their own increasingly user-friendly tools for dealing with the threat and cleaning infected machines, with some of those tools making their way into the public's hands.

Russian antivirus firm Kaspersky Lab, which has played a key role in monitoring and publicizing the threat of Flashback, yesterday announced the launch of a free web-based checker where users can simply input the hardware UUID of their Mac to see if it has registered on the firm's servers as an infected machine. The company has also released Flashfake Removal Tool, a free app that quickly and easily detects and removes the malware.

Antivirus firm F-Secure has also announced its own free Flashback Removal app. The app generates a log file detailing whether it has found Flashback on a user's system, and if so quarantines it inside an encrypted ZIP file for disposal.

F-Secure also points out that Apple has yet to offer any protection for users running systems earlier than Mac OS X Snow Leopard. Flashback uses a vulnerability in Java to install itself without user authorization, and Apple released software patches for Java on Lion and Snow Leopard last week to close that hole and prevent infection on updated systems. Machines running earlier versions of Mac OS X do, however, remain unprotected. Specifically, F-Secure notes that over 16% of Macs are still running Mac OS X 10.5 Leopard, marking a substantial user base that remains vulnerable to the threat.

Update: Kaspersky Lab has informed MacRumors that the Flashfake Removal Tool has temporarily been pulled after the discovery that in some cases it could erroneously remove certain user settings. A fixed version of the tool will be posted as soon as it is available.

Update 2: The patched version of the Flashfake Removal Tool is now available through the Kaspersky Lab site.

While the new 1080p-capable Apple TV has been available for nearly a month, Chipworks has now gotten around to tearing down the device's custom A5 system-on-a-chip, discovering with some surprise that the chip is actually a new design from Apple using a die shrink from the 45-nm process used in the A5 of the iPhone 4S to a new 32-nm process. The teardown also reveals what many had suspected: that the "single-core" A5 advertised by Apple for the new Apple TV is actually a standard dual-core chip with one of its cores disabled.

The new A5 processor die is not a single core processor, but contains a dual core processor. Either Apple is only utilizing one core or they are binning parts. Parts binning is a common process in semiconductors where devices are segregated (binned) based on meeting a subset of the overall requirements, in this case they could disable the “bad” core, this increases the usable die per wafer, lowering the cost.

As for the die shrink on the Apple TV's A5, the development raises question about why Apple made the investment in such changes to the A5 for a relatively low volume device like the Apple TV. Despite the benefits of a die shrink, the cost of implementing it for the Apple TV alone would not be inconsequential.

The new A5 measures nearly 41% smaller than its predecessor, coming in at 69.6 mm². Process shrinking not only reduce costs by fitting more dies on a wafer, but it also improves performance and lowers power consumption. This is a very complex chip for a relatively low volume part (for Apple); one would think they have greater plans for this new A5 variant.

Even the A5X used in the new iPad is manufactured using 45-nm processes, making the Apple TV the company's first iOS device to move to the smaller and more efficient 32-nm process.

Update: Chipworks has now updated its report to note that the 32-nm A5 is also showing up in the latest models of the iPad 2. The observation makes it clear that Apple is using the lower-volume models as a testing ground for the more efficient 32-nm processes, with fully-functional dual-core chips landing in the iPad 2 while the Apple TV receives single-core chips with either one core intentionally disabled or one defective core.

(Thanks, @anexanhume!)

As part of today's Apple online store downtime, the company appears to have rolled out an enhancement of its sales chat support services for those looking to purchase an Apple product. While sales chat has been available for quite some time through individual product pages, the changes include a revamped chat window with a more modern appearance.

As has long been the case, sales chat support is available only during certain times of the day and dependent on availability of chat agents.

Even more interestingly, Apple appears to be using its Brazilian store as a test market for even further enhancements that allow sales specialists to share their screens with potential customers to help walk them through a product's features. MacMagazine.com.br provides an overview the process [Google translation], showing how users can participate in a virtual tour with the chat appearing along the right side of the browser window while the specialist shares his or her screen to walk through the product's features.

The report indicates that the screen sharing virtual tour feature is limited to the iPad 2 for the time being, but that the company has plans to extend it across its product lines.

Amid swirling rumors of an imminent update for the 15-inch MacBook Pro driven by a claimed April 29 launch date for Intel's quad-core mobile Ivy Bridge processors, CPU World reports that benchmarking of one of the chips likely to appear in the new MacBook Pro shows fairly significant improvements in performance, particularly in graphics.

The chip being tested was the Core i7-3820QM, a 2.7 GHz processor with turbo speeds up to 3.7 GHz paired with Intel HD 4000 graphics. The chip is scheduled to debut with a price of $568 in high volume, and seems to be the natural successor to the Sandy Bridge Core i7-2860QM that is the current high-end processor for the 15-inch and 17-inch MacBook Pro, available as a build-to-order option.

For benchmarking comparisons, the new Ivy Bridge Core i7-3820QM chip was pitted against a Sandy Bridge Core i7-2960XM, which is an even higher-performance "Extreme" chip than is available in the current MacBook Pro. Consequently, any performance increase between the current high-end MacBook Pro chip and this new Ivy Bridge chip would be even greater than outlined in the benchmarking comparison.

Overall, the 3820QM was found to score an average of 9% higher than the Extreme 2960XM chip, a modest improvement but one which should be significantly higher relative to the 2860QM chip from the current MacBook Pro. Taking into account a roughly 10% higher performance for the tested 2960XM Sandy Bridge processor compared to the 2860QM actually found in the current MacBook Pro, the new 3820QM Ivy Bridge processor should offer roughly 20% higher CPU performance than is currently available in the MacBook Pro.

Looking at the CPU performance, using a few tests, we can see how the reduced production process helps the performance for a number of standard tests. In 3DMark Vantage (Entry level preset), Ivy Bridge has a 10% performance improvement over Sandy Bridge for the CPU score, and 9% in the physics score. In Cinebench 11.5, the single thread test showed a performance boost of 4%, and the multi-threaded test gave an improvement of 10%. The performance boost in the Truecrypt 7.0a - AES test was 4%. Finally, using x264 HD Benchmark 4.0, test 1 showed a boost of 13%, and test 2 showed a boost of 11%.

Even more significant gains for the Ivy Bridge chip show up in graphics performance, where the Intel HD 4000 integrated graphics supplants the HD 3000 graphics found in the Sandy Bridge chips. According to the benchmarks, the new HD 4000 integrated graphics outperforms the current graphics by anywhere from 32% to 108% depending on the test.

Apple of course also includes a dedicated graphics chip in its larger MacBook Pro models, giving users the option of higher performance with the dedicated chip or increased battery life with the integrated graphics. And given that the HD 4000 integrated graphics does not yet approach the performance of dedicated chips, those looking for maximum performance will still want to take advantage of whichever dedicated graphics option Apple includes in updated MacBook Pro models.

But significant improvements to integrated graphics performance could show up as a benefit in a number of areas, including providing users with better performance even when opting for the battery-conserving graphics settings. Apple has also reportedly been considering using integrated graphics only in some of its mid-range MacBook Pro models, with the HD 4000 chip making it feasible for the company to drop the dedicated graphics chip on some of those models while still being able to offer acceptable graphics performance.

Finally, the HD 4000 graphics will offer a marked improvement for the 13-inch MacBook Pro, which is expected to debut in June when Intel rolls out its dual-core Ivy Bridge processors. The smaller 13-inch form factor requires that those models rely solely on integrated graphics, meaning that all users would see a significant boost from the current HD 3000 graphics to the new HD 4000 graphics.

Following up on last month's threat to file suit over the Apple-backed agency model of e-book pricing, the U.S. Department of Justice today sued Apple and a number of book publishers over the practice, Bloomberg briefly reports. Settlement talks had been ongoing, but Apple and the publishers were reportedly unwilling to meet the Department of Justice's demands.

The U.S. filed a price- fixing antitrust lawsuit against Apple Corp. and Hachette in New York district court over eBook pricing. The government also sued HarperCollins, Macmillan and Penguin, according to court papers.

Settlement talks had centered around dismantling the agency model, which sees publishers set retail pricing and vendors receive a percentage of the sales price. Apple had pushed for the agency model in an attempt to dilute Amazon's power in the book market, where it had offered vast discounts, even sometimes selling books at a loss, in order to attract customers who would make other purchases through the site.

But the Department of Justice believes that the agency model as implemented by the publishers at Apple's behest amounts to collusion, with contracts between Apple and the publishers including language that prevented the publishers from offering lower pricing to competitors than they did to Apple. Contrary to the government's claims of an anti-competitive impact from the agency model, Apple and several of the publishers have argued that the move has fostered competitiveness by limiting Amazon's stranglehold on the book market. Consequently, the two sides have been unable to reach a settlement.

Update: Bloomberg reports that the Department of Justice has reached a settlement with Simon & Schuster, Hachette, and HarperCollins over the issue. Once finalized, the settlement would leave Apple, Macmillan and Penguin as defendants in the case.

Macmillan CEO John Sargent has published an open letter to the publisher's authors, illustrators and agents outlining why it will fight the lawsuit.

It is always better if possible to settle these matters before a case is brought. The costs of continuing—in time, distraction, and expense— are truly daunting.

But the terms the DOJ demanded were too onerous. After careful consideration, we came to the conclusion that the terms could have allowed Amazon to recover the monopoly position it had been building before our switch to the agency model. We also felt the settlement the DOJ wanted to impose would have a very negative and long term impact on those who sell books for a living, from the largest chain stores to the smallest independents.

Sargent notes that Macmillan makes less money under the agency model than it did under the previous wholesale model, but that it made the change to support competitiveness in the market, not stifle it.

Addressing the Department of Justice's claim that publishers and Apple colluded to fix pricing, Sargent also describes the circumstances under which he made the final decision to move to the agency model, calling it the "loneliest decision" he has ever made.

The government’s charge is that Macmillan’s CEO colluded with other CEO’s in changing to the agency model. I am Macmillan’s CEO and I made the decision to move Macmillan to the agency model. After days of thought and worry, I made the decision on January 22nd, 2010 a little after 4:00 AM, on an exercise bike in my basement. It remains the loneliest decision I have ever made, and I see no reason to go back on it now.

Update 2: The Department of Justice has released a transcript of a press conference statement from Attorney General Eric Holder regarding the lawsuit.

Update 3: Connecticut Attorney General George Jepsen today announced that a group of sixteen states have followed the Department of Justice's lead and filed their own lawsuit against Apple and publishers. The complaint claims that consumers were overcharged by at least $100 million due to the alleged price fixing.

Update 4: The Verge has a thorough analysis of the highlights from the Department of Justice's filing.

We typically avoid posting a story each time the Apple Store goes offline for updates. While the Apple online store famously goes offline to introduce new products, it also goes down for routine maintenance.

Tonight's downtime is likely related to maintenance or other non-product tweaks, but notably the "We'll be back soon" graphic that should be quite familiar to long time Apple followers has been changed.

The original graphic (above) was on a sticky note and has been in place for many years. Every time Apple's online store goes down, visitors would be greeted with this yellow sticky. Tonight, we see a new graphic overlaying a linen background that has been popularized in iOS.

Apple has several product lines that are due for updates soon, including the Mac Pro and MacBook Pro. These overnight downtimes, however, are more typically related to routine maintenance rather than new products. The change in "We'll be back" graphic may foreshadow other graphical tweaks to the online store.

Update: The online store returned without any notable changes.

Apple published a support document this evening regarding the Flashback malware that affects OS X computers. We previously detailed the software which began life last year as a trojan and has morphed into a drive-by download taking advantage of a vulnerability in Java that Apple did not patch until last week.

The malware is said to have infected over 600,000 Macs worldwide. While 3rd party tools have been developed to test for the infection, Apple reveals they are working on their own tool to detect and remove the software:

Apple is developing software that will detect and remove the Flashback malware.

In addition, Apple has been working with ISPs worldwide to disable the servers that send commands to the malware.

9to5Mac claims to have some early details about Apple's next version of iTunes. iTunes 11 has been internally seeded and is said to include under-the-hood changes and early support for iOS 6, which has not yet been announced.

The main focus seems to be on iCloud:

iTunes 11 includes an increased presence of iCloud integration. Perhaps the biggest testament to this is a dedicated iCloud settings panel within iTunes. This panel is a centralized, always accessible spot for users to control iCloud related features while in iTunes. These features include iTunes Match, iTunes in the Cloud, iCloud iOS device backups and more.

An increased focus around iCloud makes sense as Apple's Tim Cook has said that he doesn't view iCloud as short term product, but instead a long term strategy for the next 10 years. When asked about it at the Goldman Sachs Technology Conference, he responded:

I view iCloud not as something with a year or two product life -- it's a strategy for the next decade or more. It's truly profound.

Apple is equipping its London Genius Bars with replacement international keyboards for MacBooks and considering stocking new MacBooks with American, Asian and other international keyboards ahead of the 2012 Summer Olympics in the city, according to a report from TUAW.

A high-level Apple retail employee here in London told me today that the company is planning to stock its London area retail stores with international replacement MacBook Pro, MacBook Air, and MacBook keyboards. This way, the retail outlets will have the spare parts on hand should international journalists need a quick turnaround on a damaged laptop.

As my source told me, "London is going to be overrun by an onslaught of journalists when the games begin. We want to be prepared should they need help with their equipment during the time they are here."

TUAW notes that along with the thousands of athletes and other support staff attending the Olympics, more than 10,000 print journalists are expected to be covering the games, along with numerous other bloggers, editors, photographers, videographers along with thousands of tourists -- many of them Mac and iOS users.

The stocking of international keyboards will be important for foreign Mac users coming to the city for the Olympics. Generally, Apple Stores only stock keyboards localized for the country in which the store is located, and international keyboards must be ordered separately. This would be impractical for Mac users covering the games, as time will be of the essence on any repairs.

It is likely that the London-area retail stores will see some of their heaviest traffic ever during the Summer Olympics, and will have extremely high staffing levels to prepare for it. London itself has five Apple Stores, including the Regent Street and Covent Garden flagships.

The 2012 Olympic Summer Games will run from July 27th through August 12th.

Amid continuing rumors that Apple is looking to increase the size of the iPhone display from the existing 3.5-inch screen to something in the range of 4 inches, one persistent concern has been how Apple would deal with the change in screen dimensions.

All models of the iPhone and iPod touch released to date have carried a 3.5-inch screen with a 3:2 aspect ratio, allowing developers to target their apps at a single screen size. With the addition of Retina displays in 2010, the screens now come at much higher resolution, but the extra resolution is dedicated to increasing the visual quality of content rather than increasing screen real estate. The introduction of the iPad in 2010 added a new display size to the mix, but the considerable difference in screen size compared to the iPhone made it reasonable for developers to create custom interfaces, either in the form of universal apps or separate iPad and iPhone apps, for use on the different devices.

But moving to a slightly-larger iPhone display would seem to cause issues for Apple and its developers, with the company seemingly having two options: either increasing pixel size to keep the same resolution but on a slightly larger display; or maintaining pixel size and increasing resolution correspondingly. The former solution would allow existing iPhone apps to fit the new device's screen with no modifications but with only limited utility, while the latter solution would seem to require developers target yet another screen size with their apps.

But as outlined at The Verge, one method for achieving the latter solution in moving to a 4-inch display would be to change the aspect ratio, maintaining the existing 640 pixel width but stretching the height of the display until it reaches a 4-inch diagonal. Simple geometry yields a screen height of roughly 1152 pixels for a 4-inch display, compared to 960 pixels on the current 3.5-inch display.

The forum poster, a user by the name of modilwar, was inspired by a comment from a caller named "Colin" on The Vergecast show who suggested that change in aspect ratio as a possibility for a larger display. Using that idea, modilwar developed a series of illustrations showing how this could be achieved.

At the most basic level, an increase in the height of the display would allow Apple to show five rows of icons on each page of the iPhone's home screen, up from the current four rows. Apple would also likely find it fairly easy to augment its own apps to take full advantage of the increased vertical screen real estate.

As for third-party apps, modilwar notes that many apps already utilize standard interface elements such as navigation buttons and bars at the top and bottom of the screen supporting a larger main content window in the middle. In the case of these apps, the main windows could simply expand vertically to show more content than on the current iPhone. Examples include browsers that could show more of a webpage, Twitter apps that could show more of a timeline, and mapping apps that could show more map tiles.

Other apps with custom user interface elements would require a bit more work, but in the meantime could simply be displayed at their current sizes with a 96-pixel wide black bar at top and bottom on the larger 4-inch display.

This new 4-inch screen with a 9:5 aspect ratio would also perform much better at displaying widescreen 16:9 video content, leaving bars on either side of the screen that are only 7 pixels wide, compared to 50 pixels for unzoomed content on the current iPhone.

Modilwar passes off his post as an intellectual exercise simple showing one way in which Apple could make a change to the iPhone's display with a minimum of disruption to the iOS ecosystem, but in a bit of a curious turn the post was picked up by Daring Fireball's John Gruber, who hints that the original idea may not be all that far-fetched.

Methinks “Colin” wasn’t merely guessing or idly speculating.

Since Gruber has been known to speak coyly about his occasional inside knowledge, it is unclear whether he has independent knowledge supporting the idea of a taller display for the iPhone or if he simply has a gut feeling that "Colin" may legitimately be tipping some information at least partially tied to Apple's thinking.

Update: "Colin" has been revealed to be Timothy Collins, who has no direct association with Apple.